Do you have to worry about municipal rates that are in arrears?

When you buy a new home, the conveyancing attorney applies for a rates clearance certificate from the municipality for the past two years. This will be the responsibility of the seller to pay, before transfer can take place into your name.

The South African Constitutional court has recently ruled that it is unconstitutional for municipalities to charge new owners for arrears in municipal rates older than two years, which were incurred by any previous owner of the property.

Municipalities will now no longer be able to recover arrears older than two years as a “charge upon the land” (section 118(3) of Municipal Systems Act) The onus is now upon them to get the sums owed from the previous owner of the property and also to get accurate figures at the time of transfer. Historical debt is not transmissible.

Good news, good outcome for buyers of new homes – you can start with a clean municipal slate!